travel tech insights

There are times when all of us make the mistake of assuming we know the facts behind an event, trend or circumstance - only to learn at some point how very wrong our unchallenged assumptions and beliefs were. For instance, take a recent event, light years removed from the travel industry, which undercut a flawed understanding held by many people.

There are times it seems the travel industry should take a cue from its customers; go to some quiet place and just relax for a long time without reading anything about travel (except this blog, of course) or talking to anyone in the business.

During the past decade it has certainly seemed to be the case that disruption has been experienced to a far greater degree on the leisure side of travel rather than business side. Leisure travel has been impacted by OTA and witnessed the role of the travel agent - though still a force now – reduced in decision-making influence to that of friends, family and social media.

This week I was on a software provider's website and read this description of an ERP product feature, “With FeatureABC, the accuracy, the reliability and the availability of information are improved so management can make better strategic decisions more quickly. Consolidation is beneficial in many processes in an agency.”

At first, I found myself thinking, “What are they talking about? What does this mashup of adjectives even mean?” Then I thought, “How many people in the travel industry even know what reports they need, much less what reasonable expectations should be for their reporting tools and database?”

Think about the travel industry: is one of the most dynamic and segmented industries. As a player in this industry, there are lots of things that you need to think about: GDS commissions, hotel banks, markups, reseller networks, accuracy of the content and many more. And you don't just need to know about them now and then. You need to pay very close attention to what's happening in your market because the travel market is extremely dynamic.

Considering all of these, many of the players in the travel industry have lost their focus. They have forgotten who they are talking with, and what is their main target: The customer.

A recurring theme in this blog is the central role travel technology plays in the business model of successful travel companies, particularly enterprise resource planning (ERP) systems designed for the travel industry. There’s a simple explanation for this – Travel ERP has the potential to deliver such a wide array of benefits that it fits into any number of travel topics: reducing operational costs with automation; making better decisions with more accurate reporting; or supporting sales with better travel partner integration, just to name a few.

Like every other sector of the travel industry, steady growth in business travel doesn’t necessarily translate into increased sales for every travel management company (TMC). The travel sector is challenging because the business model is complex and competition is fierce.

One travel industry trend that holds particular promise for growth is experiential travel. To an increasing extent, people want to return from their destinations with a sense of having authentically experienced that part of the world.

A great deal of the discussion around travel technology involves highly visible customer-facing solutions: travel apps; responsive websites; social media and the like. Operational technology, focused on helping management and staff run the business, tends to get overlooked. A perfect example is enterprise resource planning (ERP) systems specifically developed for the travel industry. An increasing number of travel agencies, tour operators and TMCs are deploying them, but there’s not much discussion about this technology in general travel media. If you aren’t familiar with the Travel ERP topic, you need to be: the trend for these systems isn’t based on hype or superficial value; it’s driven by real process benefits and significant competitive advantages.

The travel business is hard. It sells a high-priced, discretionary item at a time when every region of the global economy is growing slowly – if at all. The travel industry is facing its own particular challenges – consolidation, intense competition, eroding margins and high customer expectations. Of course there are bright spots, particularly in the way technology is making people so much more aware of the delights and truly unique experiences travel has to offer. Travel may be a discretionary expense, but it also provides the customer with – literally – a way to leave their worries behind and step into an entirely different world.